[NBNYer]

Originally Posted by MonctonRad

Thanks. I note that you have over a decade of training (although you didn't specify the exact number of years). If I recall, you are a dental professional. Personally I have 13 years of university and post graduate training. For some medical specialties it can be as much as 15 years of training. This is a huge personal investment (both in time and in money), and means that you end up delaying your income earning years until your early to mid 30's. As such, you might only have 25-30 years to make this investment back before retiring, perhaps less if your health is poor or if other circumstances intervene.

My situation is very similar to yours. I have 12 years of university and post-grad training and started working in my early 30s.

Originally Posted by MonctonRad

I would imagine the answer is "it depends".

If (for example) you were a native NBer who has spent his/her entire teaching career in Vancouver and had accumulated a nice defined benefits retirement plan and a $2M bungalow in a modest Vancouver neighbourhood that you could sell for an insane profit, it would make a lot of sense to retire back home in New Brunswick.

For a self employed professional like NBNYer or myself, the circumstances can be markedly different. We have no pension plans. We will be subsisting in retirement entirely on our savings and our RRSPs. Our teacher friend (with the defined benefit retirement plan) has nothing to worry about, even if he/she lives to be 110. We on the other hand may have budgeted on the prospect of living to the age of 85, but might have the misfortune of living to 95. Self employed individuals can have the real prospect of outliving their savings. We require a tax efficient strategy in order to access and utilize our savings and this might be more easily had in a different jurisdiction.

For example, let's say I wanted to buy one final brand new car when I was 72. The most economical way to do this would be by using cash, but to do this I would have to take a dividend from my professional corporation. This dividend will increase my "income" that year, by a considerable amount, likely enough to push me into another tax bracket and thus increase my taxation rate. I will therefore have to withdraw much more money from the corporation than I intended just to pay for the additional tax. This could be a large amount, especially in the brave new world of Brian Gallant's New Brunswick. If I were living in Alberta or BC however, the tax rates could be considerably lower and I could thus keep more of my money in the professional corporation so that I could prolong my retirement savings a little bit longer.

This is why professionals without pension plans might be better off retiring somewhere else.

This is exactly right and may point to some unintended longer term consequences for the province.